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the difference between the value of the article if it had been as represented and its actual value as delivered. "It is obvious," said the court in a recent case, "that these two rules cannot be reconciled. One gives to the party deceived the full benefit of his bargain. The other does not. We are clear that the best reason is with the doctrine that, where one is deceived and defrauded, he can recover as damages the difference

the difference between the actual value of that which he parts with and the actual value of that which he receives under the contract. It is the loss which he has sustained and not the profits which he might have made by the transaction. It excludes all speculation and is limited to compensation" [citing Smith v. Bolles, supra; Busterud v. Farrington, 36 Minn. 320; Reynolds v. Franklin, supra; Stickney v. Jordan, supra; Fixen v. Blake, 47 Minn. 540, 50 N. W. R. 612; Wallace v. Hallowell, 56 Minn. 501, 58 N. W. R. 292; Woolenslagle v. Runals, 76 Mich. 545, 43 N. W. R. 454; McAleer v. Horsey, 35 Md. 439; Buschman v. Codd, 52 Md. 202; High v. Berret, supra].

1 Fargo Gas L. & Coke Co. v. Fargo Gas & Elect. Co., supra [citing Page v. Wells, 37 Mich. 415; Williams v. McFadden, 23 Fla. 143; Nysewander v. Lowman, 124 Ind. 584; Noyes v. Blodgett, 58 N. H. 502; Stiles v. White 11 Metc. (Mass.) 356, 45 Am. Dec. 214; Lunn v. Shermer, 93 N. C. 164; Vail v. Reynolds, 118 N. Y. 297; Morse v. Hutchins, 102 Mass. 439; Doran v. Eaton, 40 Minn. 35; Woolman v. Wirtsbaugh, 22 Neb. 490; Drew v. Beall, 62 Ill. 164; Cox v. Gerkin, 38 Ill. App. 340; Wynn v. Longley, 31 Ill. App. 616; Krumm v. Beach. 96 N. Y. 398; Whitney v. Allaire, 1 N. Y. 305; Horne v. Walton, 117 Ill. 130; Jack son v. Armstrong, 50 Mich. 65; Matlock v. Reppy, 47 Ark. 148, 14 S. W.

R. 546; Reggio v. Braggiotti, 7 Cush. (Mass.) 166; Woodward v. Thacher, 21 Vt. 580, 52 Am. Dec. 73; Page v. Parker, 43 N. H. 363, 80 Am. Dec. 172].

In Warner v. Benjamin (1895), 89 Wis. 290, 62 N. W. R. 179, it is said: "The well-established rule of damages upon a sale of personal property which is voidable on account of fraudulent representations is the difference between the real value of the article sold at the time of the sale and what the value would have been had the representations been true." To same effect: Potter v. Necedah Lumber Co. (1899), 105 Wis. 25, 81 N. W. R. 118; Whiting v. Price (1898), 172 Mass. 240, 51 N. E. R. 1084.

In the case of a horse, this difference in value plus the expense of keeping him a reasonable time to test his correspondence with the representations. Peak v. Frost (1894), 162 Mass. 298, 38 N. E. R. 518.

Misrepresentation as to selling price. Where the seller falsely asserts that the price made is the same as that at which he sold to another person, and the sale is made on that express understanding, the measure of damages will be the difference between these two sums. Kilgore v. Bruce (1896), 166 Mass. 136, 44 N. E. R. 108. Compare Potter v. Necedah Lumber Co. (1899), 105 Wis. 25, 81 N. W. R. 118.

2 Fargo Gas L. Co. v. Fargo Gas & Elec. Co., supra.

between the value of what he would have obtained had the statement been true, and the value of what he actually received. This represents his actual loss by reason of the fraud of the seller, on the theory that he does not rescind the contract. Of course, if he sees fit to rescind for fraud, he can only recover back what he has paid. But if he desires to stand by the agreement, as he has a perfect right to do, he can logically say to the wrong-doer, 'If you had told me the truth, the property would have been worth so much. It is not worth so much because it is not as you represented it. I demand that you make good the difference in money.'

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The weight of authority seems clearly with the latter view.

§ 1844. Buyer may recoup damages in action by seller for price. Instead of taking active steps for the recovery of his damages by bringing an action against the seller, the buyer who has not paid the price may wait until he is sued for it by the seller, whether the action be upon the count for goods sold, etc., or upon a note given for the price, and may then avail himself of his demand, whether for failure to perform, breach of warranty or fraud, by way of recoupment or counter-claim.' Where he does so, the same general rules govern his right to damages as where he takes the initiative. In this case, as in that, he is not bound to offer to return the goods or to give

1Steigleman v. Jeffries (1815), 1 Serg. & Rawle (Pa.), 477, 7 Am. Dec. 626; Peden v. Moore (1831), 1 Stew. & Port. (Ala.) 71, 21 Am. Dec. 649; McAlpin v. Lee (1837), 12 Conn. 129, 30 Am. Dec. 609; Getty v. Rountree (1850), 2 Pin. (Wis.) 379, 54 Am. Dec. 138; Falconer v. Smith (1851), 18 Pa. St. 130, 55 Am. Dec. 611; Huntington v. Lombard (1900), 22 Wash. 202, 60 Pac. R. 414; Tacoma Coal Co. v. Bradley (1891), 2 Wash. 600, 27 Pac. R. 454, 26 Am. St. R. 890; Underwood v. Wolf (1890), 131 Ill. 425, 23 N. E. R. 598, 19 Am. St. R. 40; Har

row Spring Co. v. Whipple Harrow Co. (1892), 90 Mich. 147, 51 N. W. R. 197, 30 Am. St. R. 421; Hodge v. Tufts (1896), 115 Ala. 366, 22 S. R. 422; Wilbur Lumber Co. v. Oberbeck Co. (1897), 96 Wis. 383, 71 N. W. R. 605; Parry Mfg. Co. v. Tobin (1900), 106 Wis. 286, 82 N. W. R. 154; Kester v. Miller (1896), 119 N. C. 475, 26 S. E. R. 115; St. Anthony Lumber Co. v. Bardwell-Robinson Co. (1895), 60 Minn. 199, 62 N. W. R. 274; Springfield Milling Co. v. Barnard (1897), 49 U. S. App. 438, 26 C. Ç. A. 389, 81 Fed. R. 261.

notice of the defects, as a condition precedent to making his defense.1 Neither is he, in this case any more than in the other, bound to anticipate and search for defects before using or disposing of the goods. In this case, also, as in the other, the fact that he may have paid part of the price does not debar him from this defense; nor will the fact that he may not have paid in the manner agreed upon.*

§ 1845. Defense of failure of consideration.- As has been seen in an earlier chapter," the seller may so far fail in the performance of the undertakings on his own part which are conditions precedent to the undertaking of the buyer that the latter when called upon by the former to perform may defend upon the ground that the consideration for his promise has so completely failed as to release him from liability.

1 Thus, in Tacoma Coal Co. v. Bradley, supra, it is said: "That the vendee may retain the goods without notice, and plead breach of warranty in an action by the vendor for the purchase price, is shown by numerous authorities [citing Dayton v. Hooglund, 39 Ohio St. 671; Polhemus v. Heiman, 45 Cal. 573; Holloway v. Jacoby, 120 Pa. St. 583, 15 Atl. R. 487, 6 Am. St. R. 737; Babcock v. Trice, 18 Ill. 420, 68 Am. Dec. 560; Bagley v. Cleveland Rolling Mill Co., 22 Blatchf. 342, 21 Fed. R. 159].

Retention of a machine sold under a warranty, in the absence of any agreement as to its retention or return, does not prevent the vendee from setting up the warranty by way of counter-claim when sued for the price. Hooper v. Story (1898), 155 N. Y. 171, 49 N. E. R. 773.

If a buyer has by mistake received what he did not buy he may return it or keep it and recoup, when sued for the price; or, if he has paid the

price, he may sue for the difference between the price paid and the market price of the substituted article. Columbian Iron Works v. Douglass (1896), 84 Md. 44, 34 Atl. R. 1118, 33 L. R. A. 103, 57 Am. St. R. 362.

2 Tacoma Coal Co. v. Bradley,supra. 3 A partial or complete want of consideration may be pleaded to an action on a note for the price of property, where there has been a breach of warranty. Payment of interest coupons will not estop the maker of the note from making this defense. Huntington v. Lombard (1900), 22 Wash. 202, 60 Pac. R. 414.

4 A buyer of an engine may defend an action on his note for the price by pleading fraudulent representations, notwithstanding the fact that he failed to give a mortgage on the engine to secure the note according to his agreement. Cash v. De Long (Ky., 1899), 53 S. W. R. 1037. 5 Ante, § 831 et seq.

§ 1846. Thus, recalling what has been already elsewhere said, where the goods contracted for are never delivered at all,' or, though delivery were tendered, were not of such kind, quality or condition, or in such quantity, at such place or time, that the buyer was bound to receive them, and he rejected them, or, if delivered, were returned by virtue of an express or implied right to do so, or have become worthless because of the failure of the seller to perform his agreement with respect of them, there would clearly be such an entire failure of consideration as would defeat a recovery by the seller. These matters, as has been so often seen, stand as conditions precedent to the buyer's liability. And the same result would ensue if the seller failed, in such respects, in part only where the contract was entire, or pro tanto where it was severable."


§ 1847.. So, as has been seen, where patents sold prove, not simply of little or no value, but void; or notes, bonds, scrip and other similar commercial securities prove not to be genuine; or the seller is found to have no title to the goods which he has assumed to sell, and the like cases, there is such a failure of consideration as will defeat recovery.

§ 1848. Recovery as for failure of consideration.— And lastly, there are, as has also been seen, many cases in which there has been such a complete and total failure on the part of

1 See, for example, Nash v. Towne (1866), 72 U. S. (5 Wall.) 689.

5 See Young Mfg. Co. v. Wakefield (1876), 121 Mass. 91; Wheadon v. Olds

2 See, for example, Pope v. Allis (1838), 20 Wend. (N. Y.) 174; Hill v. (1885), 115 U. S. 363. Rewee (1846), 11 Metc. (Mass.) 268; See Norris v. Harris (1860), 15 Cal. Morgan v. McKee (1874), 77 Pa. St.


There is a total failure of consideration for notes given for the purchase price of trees where the seller agreed to set them out and care for them and failed to do so, the result being their total loss. A total failure of consideration may be shown under the general issue. Perkins v. Brown (1897), 115 Mich. 41, 72 N. W. R. 1095.

228; Richards v. Shaw (1873), 67 Ill. 222. Or, though originally entire, is treated by the buyer as severable. Avery v. Willson (1880), 81 N. Y. 341, 37 Am. R. 503.

6 Ante, § 834.
7 Ante, § 835.
8 Ante, § 836.
9 Ante, $$ 838, 839.

the seller to perform that which was a condition precedent to the buyer's liability, that the latter, treating the contract as at an end, may, instead of waiting to be sued, take the initiative on his own part and recover what he has parted with as having been obtained from him upon a consideration which has failed.


§ 1849.. Thus, to repeat what has already been stated in earlier sections, if the buyer has paid the price, but the title has failed and he has been divested by the true owner; or if he has paid for a patent which proves to be invalid; or if he has paid for commercial instruments, such as notes, bonds, scrip, and the like, which prove not to be genuine,3- in these and the like cases he may recover his money as paid without consideration.

§ 1850.. So, if the buyer has paid the price in advance, but has never received the goods at all; or has rejected them wholly, as he had the right to do because they were not such as the contract contemplated; or if they were not as agreed,

1 Eicholtz v. Bannister (1864), 17 Com. B. (N. S.) 708; Ledwick v. McKim (1873), 53 N. Y. 307; Wilkinson v. Ferree (1855), 24 Pa. St. 190.

2 Darst v. Brockway (1842), 11 Ohio, 462.

3 Frank v. Lanier (1883), 91 N. Y. 112; Wood v. Sheldon (1880), 42 N. J. L. 421, 36 Am. R. 523; Thompson v. McCullough (1860), 31 Mo. 224, 77 Am. Dec. 644; Gurney v. Wormsley (1854), 4 El. & Bl. 133, 82 Eng. Com. L. 132; Paul v. Kenosha (1867), 22 Wis. 256, 94 Am. Dec. 598; Terry v. Bissell (1857), 26 Conn. 23.

Bentley (1854), 15 Ill. 420; Cleveland v. Sterrett (1871), 70 Pa. St. 204. In Winn v. Morris (1894), 94 Ga. 452, 20 S. E. R. 339, seventy dollars was paid for a mule and $1.80 extra for delivery at another place. No delivery was made at either place. Buyer may recover amount paid, with interest. Death of mule after expiration of time within which delivery was to be made, no obstacle to recovery.

5 Pope v. Allis (1885), 115 U. S. 363. Where an article delivered does not conform to the description under which it was sold, the vendee is not bound to accept, and may recover whatever of the purchase price he has paid. Meader v. Cornell (1895), 58 N. J. L. 375, 33 Atl. R. 960.

4 Nash v. Towne (1866), 72 U. S. (5 Wall.) 689; Smiley v. Barker (1897), 83 Fed. R. 684, 55 U. S. App. 125, 25 C. C. A. 9; Winn v. Morris (1894), 94 Ga. 452, 20 S. E. R. 339; Dalton v.

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