Western Mfg. Co. v. Cotton & Long

• Decision Date: 17 October 1907
• Citation: 126 Ky. 749,104 S.W. 758
• Parties: WESTERN MFG. CO. v. COTTON & LONG.
• Court: Kentucky Court of Appeals

104 S.W. 758

126 Ky. 749

WESTERN MFG. CO. v. COTTON & LONG.

Court of Appeals of Kentucky.

October 17, 1907

Appeal from Circuit Court, Madison County.

"To be officially reported."

Action by the Western Manufacturing Company against Cotton & Long. From a judgment for defendants, plaintiff appeals. Affirmed.

J. C. &amp D. M. Chenault, for appellant.

J Tevis Cobb, for appellees.

O'REAR C.J.

Appellant a manufacturer of jewelry in Minneapolis, Minn., sent its drummer into the country to make sales of its wares to retail merchants. He approached appellees, who were conducting country stores in Madison county, in this state, and proposed to sell them a bill of the goods. Appellees, being doubtful whether there was a market in their locality for such wares declined to buy. The negotiations then took the form that the drummer proposed to place its jewelry with appellees for sale, to be paid for only in the event it was sold after a fair trial. To this proposition appellees assented. A printed form of contract was then filled out by the drummer, and appellees signed it without reading it. Appellee Cotton was the member of the firm with whom the contract was made, and the only member present at the negotiations. He claims that the contract was read to him by the drummer, ostensibly containing their agreement as to the terms of the sale, and that he relied on the drummer's reading of it as to its contents. It turns out that the contract signed was materially different from the reading, in that it evidenced an absolute sale of the goods, with the agreement on the part of the purchasers to execute negotiable notes in payment on receipt of the consignment. Appellees refused to accept the goods or to execute the notes. Whereupon appellant brought this suit upon the written contract to recover the contract price. The defense is that the contract was obtained by the fraud of appellant's drummer, and was not, therefore, the act and deed of appellees. The case went to trial upon this issue, resulting in a judgment denying appellant any recovery on the contract.

A written contract may be impeached under the practice in this state for fraud practiced either in its execution or in its obtention. Whether the contract contains the true agreement of the parties, but was induced by the fraudulent misrepresentation of one of them, or whether it fails because of the fraud of a party to state truly the agreement, such as by surreptitiously substituting a false paper for the true one, or by misreading the contents of the paper, or by force or duress, its execution was procured, the party not in fault, when sued upon it, may plead the fraud as a defense in avoidance of the recovery. As it was stated for the court by Chief Justice Robertson in Tribble v. Oldham, 5 J. J. Marsh., at page 142: "When by fraud or misrepresentation a written memorial of a contract essentially variant from the agreement actually made shall have been imposed on a party, the deed or writing is not his. It is not obligatory. And in such cases the fraud or misrepresentation may be proved, without contradicting the written evidence." But, when it is said that a written contract may be impeached for fraud or mistake, it does not follow that it can or ought to be overturned lightly. The presumption is in favor of the writing. He who attacks it must bear the burden; and the rule is that the fraud or mistake must be established as clearly existing by substantial and satisfactory proof. If the paper itself is plain in its statements, easily understandable, and bears on its face no evidence of the alleged fraud, it operates by law to merge all that was spoken before, leading up to its execution. All that was said then, and which is not incorporated into the document, must be regarded as abandoned or modified by the terms finally written down and signed. Such is the very purpose of written instruments. It is to make certain that which may have been indefinite, or about which a dispute might arise, depending for its settlement upon fickle memories or interested testimony. As the paper speaks for itself, cannot be misunderstood, and forgets not, the law looks with marked favor upon written documents as evidence, placing them in the highest category. All this would be undone if either party were still at liberty to refute the writing by his own mere word, however trustworthy he may be. No rule could more completely unsettle the law of evidence, built up so painstakingly and wisely by generations of jurists and legislators.

Still the exception to the rule against the impeachment by parol testimony of written contracts, namely, that when procured by fraud, or by mutual mistake of the parties the writing does not embrace the true agreement, the courts will set aside or reform the writing, is as important and as just in every sense as the rule itself. The error is sometimes made of supposing that a mere allegation of fraud or mistake opens the written contract, and its merits will then depend upon the preponderance of the evidence. But it should always be borne in mind that written documents, admittedly signed by the parties, entered into in solemn form and with apparent deliberation--for such the writing implies--must stand, unless by strong evidence of a convincing nature the judicial mind is convinced that it was obtained by fraud, or fails because of the mutual mistake of the parties to state the true agreement. With these rules in mind, the next step is to investigate the evidence of the alleged fraud. The written contract in this case is headed in bold type, "Read this," and closes with the statement, "I have read this contract, have had delivered to me by your salesman a copy of same, and this is all of the contract between us." It is argued that these terms give strength to appellant's case, and weaken appellees'. But it must be remembered that appellee Cotton says the contract was not read by him at all, but was ostensibly read to him by appellant's agent. Unless, therefore, the statements mentioned were correctly read to appellee, their presence in the contract would constitute evidence of the attempted fraud, instead of a...