Western Carolina Lumber Co. v. Sturgill

• Decision Date: 23 December 1925
• Docket Number: 532.
• Citation: Western Carolina Lumber Co. v. Sturgill, 130 S. E. 845, 190 N.C. 776 (N.C. 1925)
• Parties: WESTERN CAROLINA LUMBER CO. v. STURGILL.
• Court: North Carolina Supreme Court

130 S.E. 845

190 N.C. 776

WESTERN CAROLINA LUMBER CO. v. STURGILL.

No. 532.

Supreme Court of North Carolina

December 23, 1925

Appeal from Superior Court, Yancey County; Oglesby, Judge.

Action by the Western Carolina Lumber Company against J. W Sturgill. From a judgment for plaintiff, defendant appeals. No error.

In action on contract, evidence held insufficient to establish fraud.

Civil action for the recovery of $4,406.82, under contract dated July 8, 1922. The material part of the contract in controversy is as follows:

"It is understood and agreed by both parties that in case of radical changes in cost of operation that would warrant an increase or reduction in price herein stipulated that both parties are willing to negotiate and make such changes as may be warranted and agreed upon."

Plaintiff alleges:

"That the defendant entered upon the fulfillment and performance of said contract and cut and delivered timber to this plaintiff until a time when he complained that he was not getting enough money to pay him for his work, and under the contract hereinbefore referred to demanded that negotiations looking toward the payment of a higher price for said cutting and logging said timber than that set forth in the contract should be paid him. Negotiations were accordingly had, when it was agreed that the price per thousand should be advanced to $10, an increase of $1.50 per thousand over and above the contract price. That the defendant, without any further demands made upon the plaintiff, finished said contract; that is to say, finished cutting and delivering the timber mentioned in the said contract. That this plaintiff advanced the defendant, from time to time, sums of money, and at times largely in excess of the amount due him, until on March 1, 1924, the defendant owed this plaintiff the sum of $4,406.82, over and above all just demands which the defendant has against the plaintiff; the same being overpayment for the said logging and delivering of said timber."

Defendant admits the contract, sets up fraud and mistake, and alleges:

"That the paper writing involved in this cause, and as set out in the complaint, was prepared by the defendant, and it was plainly understood and agreed that the written contract should encompass the terms agreed upon, and especially that part that bound the plaintiff to pay to the defendant the amount to be paid out on account of the rise in price of labor and production in general, if there should be such rise during the life and operation of the contract. That, when it was written out, this defendant asked the representative of said plaintiff, who had in charge said contract, if the whole of the contract agreed upon was covered in said paper writing, and he answered this defendant that it did, and especially did the plaintiff assure this defendant that the contract protected him against the rise of cost of production, labor, etc. That it was there agreed that this defendant should be protected against the rise of cost of production, and, if the contract as so drawn and written fails to incorporate that provision, it does not set out in the same the complete contract, and has been left out of the same, either by mistake of the parties, mutual between them, or by the artful design, scheme, and fraud of the plaintiff, as he is advised and believes, and so alleges, and said contract should be so reformed as to speak the actual agreement and contract made between the parties. That, following July 8, 1922, this defendant in good faith proceeded to carry out this part of the contract; went upon the premises and proceeded to cut, log, etc., the logs to the landing as provided for in said contract. That he had not long been engaged in carrying out said contract until labor advanced, and this defendant proceeded to notify the plaintiff of the rise in wages, and the plaintiff from time to time, as wages advanced, advised this defendant to proceed, and procure labor at the advanced price, all in contemplation of the contract made between the parties, and each time that labor advanced the plaintiff was notified, and said plaintiff each time gave orders to procure labor at the advanced price, with the usual caution to get the labor as cheap as practicable, all of which this defendant did, all by the consent, procurement, and advice of the plaintiff, and within the terms of the actual agreement between the parties. That it is true that at one time the plaintiff raised the price of cutting and logging, as required, to the sum of $10 per thousand feet, or a raise of $1.50 per thousand feet, all of which it did within the meaning of the contract and terms thereof, which bound it to pay the additional cost of production; but at the time of such raise, this defendant notified the plaintiff that such raise was insufficient to pay the additional costs of production, and that it would be held to the actual difference in costs occasioned by the rise of labor in price, and the costs of production. That it is not true that this defendant owes the plaintiff any sum whatever on account of said contract, or any advancements made by it, but the said plaintiff, by reason of said contract, is justly indebted unto the defendant by way of counterclaim, and, as an additional recovery, in the sum of $8,870.30, and this is due the defendant after allowing the plaintiff all credits, set-offs, or just demands, including the said advancement of $4,406.82, sued for by the plaintiff in this action."

The issues submitted to the jury, and their answers thereto, were as follows:

"(1) What amount, if any, is the plaintiff entitled to recover of the defendant by reason of the matters and things alleged in the complaint? Answer: $4,406.82.

(2) What amount, if any, is the defendant entitled to recover of the plaintiff by reason of the matters and things set up in the counterclaim? Answer: Nothing."

Judgment was rendered on the verdict, exceptions and assignments of error were duly made, and appeal taken to the Supreme Court.

The material assignments of error will be considered in the opinion.

Charles Hutchins, of Burnsville, for appellant.

Watson, Hudgins, Watson & Fouts, of Burnsville, for appellee.

CLARKSON J.

Pursuant to order of the court, this case was referred to and heard before J. W. Ragland, Esq., referee. At the beginning of the hearing, and before hearing began, the defendant excepted to the trial before the referee and demanded a jury trial, and tendered the issues before set forth. The referee, after hearing the evidence, gave judgment for plaintiff. Upon exceptions taken by the defendant, the case was tried in the superior court before a jury upon the issues tendered by defendant. The jury answered the issues in favor of plaintiff.

"Verdicts and judgments are not to be set aside for harmless error, or for mere error and no more. To accomplish this result, it must be made to appear, not only that the ruling complained of is erroneous, but also that it is material and prejudicial, amounting to a denial of some substantial right. In re Ross, 182 N.C. 477 [109 S.E. 365]; Burris v. Litaker, 181 N.C. 376 [107 S.E. 129]." Wilson v. Lumber Co., 186 N.C. 57, 118 S.E. 798; Layton v. Godwin, 186 N.C. 313, 119 S.E. 495; State v. Love, 189 N.C. 774, 128 S.E. 354.

Smith, C.J., in Ray v. Blackwell, 94 N.C. 10, says:

"It is a rule, too firmly established in the law of evidence to need a reference to authority in its support, that parol evidence will not be heard to contradict, add to, take from, or in any way vary the terms of a contract put in writing, and all contemporary declarations, and understandings are incompetent for such purpose, for the reason that the parties, when they reduce their contract to writing, are presumed to have inserted in it all the provisions by which they intend to be bound. 1 Greenleaf Ev. § 76; Etheridge v. Palin, 72 N.C. 213."

See Exum v. Lynch, 188 N.C. 395, 125 S.E. 15; Overall Co. v. Hollister Co., 186 N.C. 208, 119 S.E. 1.

The distinction between fraud in the factum and fraud in the treaty is ably discussed by Stacy, C.J., in Furst v. Merritt, 190 N.C. 397, 130 S.E. 40. In the opinion, various definitions of fraud are set forth. If defendant has sufficiently pleaded fraud, from the entire record, we do not think the evidence sufficient to establish it.

Defendant could read and write. The contract was discussed by paragraphs with F. B. Duane, and, when agreed...